How does Bitcoin affect property division?

On Behalf of | Feb 28, 2018 | Property Division

With the raging popularity of cryptocurrency, the term Bitcoin has become a regular household term for many. Known as a peer-to-peer electronic cash system, it gained popularity because users could transfer money to one another directly without the need for a go-between, like a bank or governmental authority. Users are assigned a string of numbers which becomes the address of their wallet where their Bitcoin is stored. The anonymity of the currency is one of its greatest appeals, especially for people looking to hide their assets

during a divorce.

The form of currency may change, but the notion that people try to hide their assets in an attempt to get the best deal in property division is an old one. Since neither banks nor names are used, some people wrongly try to hide their assets from their spouses in the form of cryptocurrency, which can create complex property division issues.

However, hiding assets is not as easy as it may seem. If someone suspects their spouse may be doing so before an impending divorce, there are avenues available to investigate. For example, when money is transferred to a Bitcoin

exchange for purchasing the currency, red flags should be raised, thereby justifying further investigation. In other words, the money can be tracked, even if it is in cryptocurrency form. This means that even if one party cannot prove what the money was being used for, but the other party cannot produce evidence as to what they purchased, the matter may weigh heavily in a property division dispute.

In a divorce, each party has the right to financial discovery, which can aid them in addressing property division matters. With this information, parties can identify parties to depose and documents to subpoena.. To ensure this right is exercised appropriately, and for the benefit of all parties involved, it might be beneficial to consult an experienced attorney.